Greenberg and John Shapiro founded Chieftain Capital Management in 1984. The firm was divided into two separate entities in 2010. Greenberg renamed Chieftain to Brave Warrior. Greenberg maintains a highly concentrated portfolio. He believes that the more companies you own, the less you know about each one. He believes this leads to mistakes. He generally invests in companies with little competition and emphasizes the return on invested capital.

The guru bought 2,498,550 shares of HCA Holdings for an average price of $76.57 per share. The trade had an impact of 9.14% on the portfolio.

HCA is a health care services company that operates general acute care hospitals, psychiatric hospitals and rehabilitation hospitals. The Tennessee-based company has a market cap of $26.2 billion and an enterprise value of $58.5 billion. It has a price-earnings (P/E) ratio of 11.1, a forward P/E ratio of 10.13 and a price-sales (P/S) ratio of 0.7.

GuruFocus ranked the company’s financial strength 4 of 10. The Piotroski F-Score of 7 and Altman Z-Score of 2.04 suggest the company is in a healthy financial condition but has faced some pecuniary stress. The return on invested capital (ROIC) outperforms the weighted average cost of capital (WACC), meaning the company is creating value as it grows.

As for HCA’s profitability and growth, GuruFocus gave it an 8 of 10 ranking. It has an operating margin of 14.9% and a net margin of 6.2%. The return on assets (ROA) and return on capital (ROC) outperform 71% and 67% of other companies in the global medical care industry.

Larry Robbins holds the largest position in HCA Holdings among the gurus with 4.3% of outstanding shares. This represents 8.6% of his total assets managed. In all, 12 gurus hold positions.

The DCF Calculator gives the stock a fair value of $67.63; it was trading at $70.46 on Monday.

Greenberg purchased 3,085,374 shares of Sensata Technologies for an average price of $37.77 per share. The trade impacted the portfolio by 5.8%.

Sensata produces sensors and controls for the automotive, appliance, aircraft, industrial and HVAC markets. The 100-year-old company has a market cap of $6.6 billion and an enterprise value of $9.6 billion. It has a P/E ratio of 16.1, a forward P/E ratio of 19.9, a price-book (P/B) ratio of 3.6 and a P/S ratio of 2.13.

GuruFocus ranked the company’s financial strength 4 of 10. It has a high Piotroski F-Score of 7 but a low Altman Z-Score of 1.8. This suggests the company is financially healthy but has faced monetary issues in the past. Since the ROIC outperforms the WACC, value is being created as the company grows.

In regard to Sensata’s profitability and growth, it was given a ranking of 8 of 10 by GuruFocus. It has an operating margin of 14.5% and a net margin of 13.2%. The return on equity (ROE) and ROA outperform 94% and 76% of other companies in the global scientific and technical instruments industry. The ROC outperforms 88% of competitors.

The DCF Calculator gives the stock a fair value of $25.9; it was trading at $38.44 on Monday.

Greenberg bought 751,775 class C shares of LiLAC for an average price of $31.25 per share. The transaction had an impact of 1.02% on the portfolio.

LiLAC Group is a branch of Liberty Global (NASDAQ:LBTYA) for operations in Latin America and the Caribbean. The stock is considered tracking stock. Liberty Global is a telecommunications company based in London. The company has a market cap of $3.5 billion and an enterprise value of $10.6 billion. It has a P/B ratio of 0.84 and a P/S ratio of 0.86.

GuruFocus ranked LiLAC Group’s financial strength 4 of 10. The Altman Z-Score of 0.4 suggests the company is in financial distress with a chance of bankruptcy in the near future.

The company’s profitability and growth was also ranked 4 of 10 by GuruFocus. While it has a good operating margin of 11.4%, its net margin pales in comparison at -11.2%. Similarly, the ROE and ROA underperform 82% and 77% of other companies in the global pay TV industry. The ROC underperforms 65% of competitors.

Griffin is the largest shareholder among the gurus. He holds 2.3% of outstanding shares, which represents 1.3% of his total assets managed. In total, 15 gurus hold positions in LiLAC Group.

The DCF Calculator gives the stock a fair value of $-39.49; it was trading at $20.41 on Monday.

Greenberg also sold out of two positions during the quarter. He sold 1,619,013 shares of Halliburton Co. (NYSE:HAL) for an average price of $43.66 per share. He sold 135,022 shares of Brookfield Business Partners LP (NYSE:BBU) for an average price of $21.83 per share.

Disclosure: I do not own stock in any companies mentioned in the article.

About the author:

Sydnee Gatewood

I am an editorial assistant at GuruFocus. I have a BA in journalism and an MA in mass communications from Texas Tech University. I have lived in Texas most of my life, but also have roots in New Mexico and Colorado. Follow me on Twitter! @gurusydneeg

It's interesting that Greenberg and Lou Simpson (Trades, Portfolio) have so much overlap in their highly concentrated portfolios: AXTA, BAM, LBTYK, LILAK, ST, SCHW. I believe they used to work together. They must (still) use similar methodologies.

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